Missouri fire departments construct group purchase agreement
By CHRIS HALL | Springfield Fire Department
As departments are tasked with an ever-widening scope of service demands, the apparatus required to meet those demands get larger and more technical. This translates into higher and higher costs, which leaves fire departments across the country scratching their heads about how to control the rapidly rising cost of fire apparatus. Three communities in southwest Missouri recently banded together to help combat that growing problem through a group purchasing agreement.
As the old adage goes, timing is everything. Several months ago, chief officers from the cities of Springfield and Republic, and the Nixa Fire Protection District, were at an event together when the topic of apparatuses came up. Springfield needed to purchase four engines, Nixa needed to purchase one and Republic was hoping for two engines but was unsure whether the funds would be available to purchase them both.
As the chiefs discussed what was important to them, they found the majority of their needs were the same. This led to the suggestion of making a single group purchase in order to help drive down the cost through greater competition. But before they could do that, they needed to see whether the purchasing departments would even entertain the concept.
Assistant Chief of Operations David Pennington met with the head of Springfield’s purchasing department, Jim Tillman. Tillman had previous experience with group purchasing and quickly agreed to oversee the process to ensure that the purchase met all local and state laws as well as best practices.
“Having a purchasing department that not only agreed to take on the task, but be an advocate, was key. Jim Tillman and buyer Mike Bell did the heavy lifting on this. We just had to decide what each of the fire departments needed in an engine,” Pennington said.
The departments put together their own apparatus committees to identify the key requirements. With that information in hand, Pennington, Assistant Chief Lloyd Walles of Nixa and Chief Duane Compton of Republic gathered an array of specifications from various vendors and from other departments that had made recent purchases. They hammered out the details, while ensuring that the bid was generic in order to allow as much competition as possible. The departments were able to standardize most of the items, and those they couldn’t standardize they put as options within the request for proposal. This process took about four months, but was essential in meeting everyone’s needs.
When the RFP was put out on the street, 17 vendors attended the pre-bid meeting; the most any of the agencies had ever experienced for an apparatus purchase. This showing put significant pressure on bidders to offer their very best pricing. In the end, 11 vendors submitted bids and the group was able to purchase a total of seven engines costing more than $2.5 million. The departments estimated that they saved about $15,000 per engine due to the number of apparatuses purchased.
The departments say that the purchase was a huge success. They plan additional group purchases of other items used regularly by the departments, including aerial ladders.
Springfield, Nixa and Republic have the following suggestions for other departments. First, reach out to your neighbors to see if they are planning similar purchases. Second, include departmental members from the agencies involved to develop a needs list. Third, focus on the commonalities of the purchase and then list any differences as bid options. Fourth, have a purchaser with a solid understanding of the bid process, laws and practices.
Lastly, keep the specifications generic to ensure maximum competition. Using these steps, departments will not only reap the benefit of lower costs, but also of improved relations and of the standardization of equipment.